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Exploring Remote Online Notarization as a Trend Across the Nation and in PLG Footprint States Indiana, Florida, Georgia, and Texas
Remote Online Notarization (RON) is a hot topic in the real estate community right now. This is a result of purchasers and sellers wanting a more flexible closing process in today’s busy world and the current landscape of the real estate market.
Last year we alerted our clients and partners to the Arkansas Supreme Court ruling in Davis v. PennyMac Loan Services, LLC, 2020 Ark. 180 (May 7, 2020), wherein the Court held the sale notices used by some Arkansas law firms was too vague to satisfy the requirements of the Arkansas Statutory Foreclosure Act. To initiate a statutory foreclosure, the Statutory Foreclosure Act requires the recording of a Notice of Default and Intention to Sell (“Notice”) that states “the default for which the foreclosure is made.” Ark. Code Ann. § 18-50-104(b). The notice at issue in Davis stated that “a default has been made with respect to a provision in the mortgage.” The Court found that such boilerplate language was not a specific enough description of the default to satisfy the Statutory Foreclosure Act. Fortunately, PLG’s Arkansas foreclosures were not affected by the decision since its Notice contained the language required by the Statutory Foreclosure Act. The Court’s decision, however, created a realm of uncertainty related to statutory foreclosures completed by firms using the faulty notice. The status of all such REO properties became a topic of much concern, and the industry sought to resolve these issues through the passage of legislation amending the Statutory Foreclosure Act during the 2021 Regular Session of the Arkansas General Assembly. Thus, Act 1108 emerged, which will most likely become effective on July 30, 2021, although this date could change due to peculiarities in Arkansas law.
The foreclosure crisis starting around 2007 bore from it a slew of legislation which attempted to help borrowers facing imminent foreclosure or the loss of their home due to foreclosure. One such piece of legislation was the Troubled Asset Relief Program, or TARP. In February of 2010, the United States Treasury established the Hardest Hit Fund in an effort to provide targeted financial aid to states hit most significantly by the subprime mortgage crisis.
Indiana is one of 19 states that received money from the U.S. Treasury to fund its Indiana Hardest Hit Fund (“the Fund”). Over the course of its run since 2010, Indiana received more than $283 million for the Fund, which was a program run by the Indiana Housing and Community Development Authority (IHCDA). The final deadline for accepting applications for the fund ended on May 3, 2021. The program provided eligible borrowers with up to $30,000.00 to reinstate their mortgage loans (see 877gethope.org). The Indiana Foreclosure Prevention Network boasts that it has provided over $182 million to over 11,000 Hoosiers in the State.
Today, the Fourth District Court of Appeal for Florida in Wells Fargo Bank, N.A. v. Tan, Case No. 4D20-613, held that Fla. Stat. 702.036 barred the Court from granting relief as it related to a Senior Mortgagee seeking to vacate a judgment that was entered against them by a Junior Mortgagee. For a little more background on this holding, “a non-party purchased the real property at issue and executed a mortgage in favor of Bear Stearns Residential Mortgage Corporation. Bear Stearns assigned the mortgage to Wells Fargo. The non-party later sold the property to Chi Peng Tan, who executed a mortgage in favor of First Magnus Financial Corporation.
First Magnus filed a foreclosure complaint against multiple defendants, including Tan and Wells Fargo. A judgment was entered that foreclosed all interests, including the interest held by Wells Fargo. The record shows that Wells Fargo recorded its mortgage before First Magnus recorded its mortgage.”
This is case is not yet final.
Senate Bill 13 was signed into law on March, 16, 2021, and effectively shortens Ohio’s statute of limitations for filing lawsuits based on breach of contract. While R.C. 2305.06 originally set forth a lengthy 15-year statute of limitations on enforcement of a contract, the statute was amended in 2012 to reduce the limitation to eight years. The 2021 amendment to Revised Code 2305.07 now further reduces the statute of limitations for breaches of written contracts from eight years to six and reduces the statute of limitations for breaches of oral contracts from six years to four years.
The new law goes into effect on June 16, 2021.
The statute of limitations in Ohio on legal malpractice claims is one year from the time the aggrieved party knew, or should have known, that the attorney committed malpractice, or from the time the attorney stopped representing the aggrieved party on that particular legal matter, whichever is later. O.R.C. 2305.11. However, Senate Bill 13 was recently passed in Ohio, and currently awaits the Governor’s signature. The Bill adds section 2305.117 to the Ohio Revised Code, and while the new section does not replace or negate 2305.11, it seeks to add a statute of repose, requiring all legal malpractice claims to be filed within 4 years, regardless of then the malpractice was actually discovered. Once signed into law, while the one year statute still applies, this will supplement the current rule in place.
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